Gold industry upset over hike in import duty

The hike in import duty of gold announced in the maiden Budget of Finance Minister Nirmala Sitharaman will have an impact on the gold prices in the retail market. The gold industry on Friday came down heavily on the government for hiking the import duty from 10 per cent to 12.50 per cent. According to industry players, the move will prove to be counter-productive.

In a statement, World Gold Council India Managing Director PR Somasundaram said the move will impede efforts to make gold as an asset class particularly when gold prices are already rising globally, and the grey market will thrive which will dilute efforts to reduce cash transactions.

“Millions of Indians invest in gold as part of their household savings, not simply as discretionary spending for consumption. People buy gold as a long-term investment to protect their wealth and gold also has huge significance socially, emotionally and economically in India,” Somasundaram said.

The Council chief further said: “We believe that gold can play a positive role in the Indian economy, but to enable this, there needs to be a reduction in overall taxes, a stable policy environment and a transparent trading market.”

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